Richoux Group PLC Subscription to raise approximately £1.09 million (1805Z)

TIDMRIC

RNS Number : 1805Z

Richoux Group PLC

29 August 2018

The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014. Upon the publication of this announcement via Regulatory Information Service, this inside information is now considered to be in the public domain.

29 August 2018

Richoux Group plc

("Richoux", the "Company" or the "Group")

Subscription to raise approximately GBP1.09 million

Further to the announcement published earlier today, the Company announces that it has raised approximately GBP1.09 million by way of a subscription (the "Subscription") of 18,168,335 new ordinary shares of 4 pence each (the "Subscription Shares") at a price of 6 pence per ordinary share (the "Subscription Price"). The Subscription is conditional upon admission of the Subscription Shares to trading on the AIM market of the London Stock Exchange ("Admission").

The proceeds of the Subscription will be used for general working capital purposes.

Enquiries

 
  Richoux Group plc         [phone] 
   Simon Morgan, Chairman 
   Cenkos Securities plc     [phone] 
   Stephen Keys 
 

Details of the Subscription

Following Admission, the Company will have 143,147,407 Ordinary Shares in issue and a market capitalisation of approximately GBP8.6 million at the Subscription Price. The Subscription Shares will represent 12.7 per cent. of the issued ordinary share capital of the Company immediately following Admission. The Subscription Price represents a discount of approximately 14.3 per cent. to the closing mid-market price per ordinary share on 28 August 2018, being the last dealing day prior to the announcement of the Subscription. Application has been made to the London Stock Exchange for the Subscription Shares to be admitted to trading on AIM and it is expected that Admission will occur on 31 August 2018.

The Subscription Shares are being allotted using the Directors' authority to allot Ordinary Shares for cash on a non-pre-emptive basis, as granted at the Company's AGM on 25 June 2018. The Subscription is neither a rights issue nor an open offer and the Subscription Shares will not be offered generally to Shareholders on a pre-emptive basis. The Directors believe that the considerable extra cost and delay involved in a rights issue or open offer would not be in the best interests of the Company in the circumstances, and accordingly, the Board considers that it is in the best interests of the Company and Shareholders as a whole for the funds to be raised through the Subscription. The Subscription has not been underwritten.

Related party transactions

Jonathan Kaye, Mehdi Gashi, Salvatore Diliberto and The Hon. Robert Rayne (the "Related Parties") will each subscribe for Subscription Shares pursuant to the Subscription ("Related Party Subscriptions"). Under the AIM Rules for Companies, each of the Related Parties constitutes a related party of Richoux by virtue of each being a director of the Company. The Related Party Subscriptions are therefore deemed to constitute a related party transaction pursuant to rule 13 of the AIM Rules.

The number of Subscription Shares placed with Related Parties and their resultant shareholdings following the Subscription is set out below:

 
 Name             Role                Existing Shareholding        Subscription       Resultant Shareholding 
                                                                 Shares subscribed 
                                                                        for 
                                       Number     % of voting                          Number     % of voting 
                                                     rights                                          rights 
 
 Jonathan         Chief Executive 
  Kaye             Officer           5,104,395       4.1%           2,083,334*       7,187,729       5.0% 
                  Executive 
 Mehdi Gashi       Director           400,000        0.3%            416,667          816,667        0.6% 
 Salvatore        Non-Executive 
  Diliberto        Director          26,236,441      21.0%         4,166,667**       30,403,108      21.2% 
 The Hon.         Non-Executive 
  Robert Rayne     Director          20,417,681      16.3%          2,916,667        23,334,348      16.3% 
 

* the figure of 2,083,334 includes 1,041,667 ordinary shares of 4p each subscribed for by Kayla Kaye, a person closely associated with Jonathan Kaye, whose shareholding is deemed to form part of Jonathan's beneficial holding.

** the figure of 4,166,667 includes 2,000,000 ordinary shares of 4p each subscribed for by Irene Diliberto, a person closely associated with Salvatore Diliberto, whose shareholding is deemed to form part of Salvatore's beneficial holding.

Simon Morgan, Chairman of the Company, is not participating in the Subscription and is therefore deemed to be independent for the purposes of the Related Party Subscriptions. Mr Morgan considers, having consulted with Cenkos Securities plc, the Company's nominated adviser, that the terms of the Related Party Subscriptions are fair and reasonable insofar as the Company's shareholders are concerned.

Concert Party

Due to the close family link, Jonathan Kaye and members of his extended family being Phillip Kaye, Samantha Sanson, Sam Kaye and Adam Kaye are considered a concert party (collectively, the "Concert Party") for the purposes of Rule 9 of The City Code on Takeovers and Mergers.

Shareholders will be aware that on 15 November 2016 a General Meeting of the Company was held whereby a whitewash resolution concerning the waiver of obligations for the Concert Party under Rule 9 of the City Code was passed by means of a poll of Independent Shareholders (the "Waiver"). On the basis that the maximum number of new Ordinary Shares were issued to the Concert Party at that time, the Concert Party would have a maximum controlling position of approximately 41.3 per cent. in the enlarged share capital of the Company (assuming Jonathan Kaye acquires in full the 23,027,403 Ordinary Shares granted under his share incentive arrangements).

Following the Subscription, the Concert Party's Shareholding upon Admission and their Shareholding following Admission and assuming Jonathan Kaye acquires in full the 23,027,403 Ordinary Shares granted under his Share Incentive are exercised in full will be as follows:

 
 Registered           The Concert        Subscription    The Concert Party's        The Concert Party's 
  Holder            Party's existing        Shares        beneficial interest       beneficial interest 
                       beneficial         subscribed        in the Company             in the Company 
                       interest in            for           as at Admission           as at Admission 
                       the Company                                                 and assuming Jonathan 
                                                                                       Kaye acquires 
                                                                                   in full the 23,027,403 
                                                                                      Ordinary Shares 
                                                                                       granted under 
                                                                                    his Share Incentive 
                    Ordinary Shares                        Ordinary Shares            Ordinary Shares 
                    Number      % of        Number         Number       % of       Number      % of voting 
                                voting                                  voting                    rights 
                                rights                                  rights 
 
 Phillip Kaye     25,654,304    20.5%     4,166,667      29,820,971     20.8%    29,820,971       17.9% 
 Samantha 
  Sanson          1,123,706     0.9%          -          1,123,706      0.8%      1,123,706       0.7% 
 Jonathan 
  Kaye            5,104,395     4.1%      2,083,334*     7,187,729      5.0%     30,215,132       18.2% 
 Sam Kaye         2,151,637     1.7%          -          2,151,637      1.5%      2,151,637       1.3% 
 Adam Kaye        1,991,636     1.6%          -          1,991,636      1.4%      1,991,636       1.2% 
 
 Total Concert 
  Party           36,025,678    28.8%     6,250,001      42,275,679     29.5%    65,303,082       39.3% 
 

* the figure of 2,083,334 includes 1,041,667 ordinary shares of 4p each subscribed for by Kayla Kaye, a person closely associated with Jonathan Kaye, whose shares are deemed to form part of Jonathan's beneficial holding

In the event that Admission of the Subscription Shares in full does not occur, the Subscription will not proceed.

Total Voting Rights

Following admission of the Subscription Shares, the Company's issued ordinary share capital will comprise 143,147,407 ordinary shares, none of which are held in treasury. Therefore, the total number of ordinary shares with voting rights in the Company following admission will be 143,147,407.

The above figure of 143,147,407 may be used by shareholders as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change to their interest in, the Company under the FCA's Disclosure Guidance and Transparency Rules

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact [e-mail] or visit www.rns.com.

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August 29, 2018 11:15 ET (15:15 GMT)